First steps to home care funding

The first step to paying for home care is finding out if the person who will be receiving the care is eligible for local authority funding. The current thresholds for eligibility can be found on the finance section of the Housing Care website.

If you are not eligible for local authority funding then you might still be eligible for NHS Continuing Health Care Funding if you have ongoing healthcare needs.

If you are not eligible for either local authority or NHS funding then you may need to pay for home care yourself. At that point it’s probably a good idea to speak to a financial advisor to ensure that you are structuring your finances in the best way possible.

Local authority support and direct payments

If your relative qualifies for council support, you do not have to accept the council’s chosen roster of providers. Instead, you can request a Direct Payment.

Under statutory home care funding arrangements, a Direct Payment is a cash sum paid by the council directly into a designated bank account managed by the individual or their family. According to data from the NHS Adult Social Care Activity and Finance Report, more than 26% of adults receiving community-based social care in England now choose direct payments.

Opting for Direct Payments allows you to choose your own regulated home care agency, decide visit times, and maintain the same Care Professionals. The family simply uses the council-provided funds to pay the care provider’s bills, keeping control over daily routines.

NHS continuing healthcare: when care is funded entirely by health services

If your loved one has complex, intense, or unpredictable health requirements, they may qualify for NHS Continuing Healthcare (NHS CHC).

Unlike local authority social care, NHS CHC is non-means-tested. It is funded entirely by the NHS and covers 100% of care fees, whether delivered in a care facility or in the person’s own home. Eligibility is based on whether the individual has a “primary health need”, assessed using the national Decision Support Tool (DST) across twelve care domains: including cognition, breathing, mobility, skin integrity, and medication management.

NHS England quarterly figures show that approximately 50,000 to 55,000 individuals across England receive standard NHS CHC funding at any one time. For individuals facing rapid health decline or nearing the end of life, the NHS Fast Track pathway can grant approval within 48 hours.

Securing this form of home care funding removes the requirement for private contributions entirely, allowing families to commission professional home support without drawing on private assets.

Maximising non-means-tested benefits to offset care costs

Many families assume that holding private pensions or savings excludes them from any government financial support. However, non-means-tested disability benefits are available to help with paying for home care, regardless of income or investments.

The most important benefit for individuals aged 66 and over is Attendance Allowance. This is paid directly by the Department for Work and Pensions (DWP) to help cover the costs of daily personal care:

• Lower rate: £76.70 per week for individuals needing frequent help or constant supervision during either the day or the night.
• Higher rate: £114.60 per week for individuals requiring assistance throughout both day and night, or those living with a terminal illness.

According to research from Age UK and the DWP, while over 1.6 million pensioners receive Attendance Allowance, more than £2.5 billion in disability and pensioner benefits goes unclaimed every year. Many older adults miss out simply because they assume their household savings make them ineligible.

Claiming this allowance provides an additional £3,900 to £5,900 per year that can be applied directly towards paying for home care, easing the monthly cost of visiting support.

For more info on & to see if you qualify for Attendance Allowance, follow our dedicated guide written by our head of quality & compliance here. 

Self-funding mechanisms: how to pay for live in care and visiting support

If your relative is not eligible for state funding, care must be self-funded. For families exploring how to pay for live in care or extensive visiting support, several specialist financial options exist to ensure fees remain sustainable over many years:

1. Immediate needs care annuities

An Immediate Needs Care Fee Payment Plan, often called a care annuity, is a specialist insurance policy designed for people who already require care. In exchange for an upfront lump-sum payment, the insurance provider guarantees to pay a regular, tax-free income directly to a registered care provider for the rest of the individual’s life.

Consulting a financial planner accredited by the Society of Later Life Advisers (SOLLA) is an essential step in understanding how to pay for live in care using an annuity. Because the payouts are transferred straight to the care provider, the income is exempt from UK Income Tax, offering predictability against rising care fees.

2. Downsizing or rental income

For families weighing up how to pay for live in care, utilising residential property can provide regular capital. Some families downsize to a smaller, more accessible home and release equity to fund care. Alternatively, if an individual moves in with family while retaining their original property, renting that house out can provide a steady monthly income stream to offset home support costs.

3. Regulated equity release

Homeowners aged 55 and over may consider equity release, such as a lifetime mortgage, to unlock tax-free capital from their property without having to move. While this provides immediate cash for home adaptations and care fees, it reduces the value of the estate left to family members and can impact eligibility for certain benefits. Professional financial advice from an FCA-regulated specialist should always be obtained first.

Transparent home care invoicing and payment methods

When funding care privately or through council direct payments, managing the practical administration of your account should be straightforward and predictable.

At Radfield Home Care, our approach to home care invoicing is transparent and flexible:

• Fortnightly invoicing cycles: Invoices are issued every two weeks, clearly detailing the dates, visit lengths, and services delivered during that billing period.
• Multiple payment routes: Families can settle invoices using automated bank transfers (BACS), standing orders, or direct payments from managed care accounts.
• Shared family invoicing: Where multiple siblings or relatives contribute to a parent’s care costs, accounts can be split across contributors to make shared payments simple.
• Guaranteed visit duration: We never deduct travel time from the length of our care visits. If you schedule a 60-minute visit, our Care Professional spends the full 60 minutes with your relative.

Clear home care invoicing ensures families retain complete visibility over their expenditure, avoiding unexpected administrative surcharges.

Practical steps to organising your care payments

Before committing personal funds, taking a structured approach to your finances protects your family’s assets:

1. Request statutory assessments: Contact the local council for a Care Needs Assessment and ask a GP or district nurse whether an NHS Continuing Healthcare checklist is appropriate.
2. Submit a benefit check: Ensure your loved one claims Attendance Allowance and checks eligibility for Pension Credit and council tax reductions.
3. Seek accredited advice: If self-funding extensive care, consult a SOLLA-accredited independent financial adviser to examine care annuities and tax-efficient asset structures.
4. Establish a dedicated account: Setting up a separate bank account for care fees simplifies tracking council direct payments, benefit receipts, and regular care invoices.

Understanding how to pay for home care empowers your family to build a high-quality, sustainable support plan that preserves your relative’s independence in the comfort of their own home.

Paying for home care yourself

When funding care privately or through council direct payments, managing the practical administration of your account should be straightforward and predictable. At Radfield Home Care, our approach to home care invoicing is transparent and flexible

To give you an idea of how much it costs to receive home care we have put together some of the most common reasons that people use our services below, with the likely costs attached (which vary depending on location).

Taking you out to the shops

The Care Professional will come to your home and make sure you’re ready to go with everything you need. They’ll then drive you to your destination and assist you with anything you may need. Once you’re all finished and ready to go, they’ll take you home, helping you to unpack and ensure you’re settled.

A visit like this will probably take about 2 hours and costs between £56 and £64.

Help with household tasks or companionship

A Care Professional can spend time in your home for companionship, helping you with household tasks. This can give existing carers a break and help you to get some tasks ticked off the to-do list. Our carers can assist you with laundry, changing beds, ironing, taking bins out, cleaning, meal preparation, monitoring food stocks and discarding when out of date. We can assist with most tasks, so if you need something specific just let us know.

A 3 hour call once a week would cost between £80 and £95.

Home care after being in hospital

Spending time in hospital can be a difficult experience, which may lead to you needing care at home. Initially you may require assistance with washing and dressing, getting in and out of bed, administering medication, meal preparation and help with household tasks. The amount of care could reduce gradually week on week as independence is regained.

Initially one hour three times a day – cost between £550 and £650 per week. Reducing to 30 minutes twice a day – cost between £325 and £425 per week.

The actual cost may differ depending on how far care assistants have to travel to your home, or if you require care on a bank/public holiday. There are no additional charges and our carers always stay the full amount of time with you, their time spent travelling is not taken out of your care visit time.

Home care funding next steps

If you would like to discuss your care needs in more detail or find out exactly how much home care would cost you then please contact us. We can provide you with more information based on your own personal circumstances and if you would like us to, a member of our team can come out and see you at home.

This service is free of charge and allows you to ask as many questions as you like.